Calgary, October 23, 2023 – Via Daily Oil Bulletin

Balanced tax treatment is one of the areas a new association dedicated to helium developers is pursuing through regulatory advocacy.

The Helium Developers Association of Canada (HeDAC) was established earlier this autumn, with former long-time Encana Corporation executive Richard Dunn tapped as executive director.

Currently with five members, the group represents companies that explore, develop and produce helium in Western Canada.

Government and regulators are “a lot more receptive when it’s an industry group than an individual company coming forward, so there is not an individual company gaining an advantage or anything like that,” Chris Bakker, CEO of Avanti Helium Corp., told the DOB.

Avanti is a member company of HeDAC, and Bakker serves as a HeDAC co-chair. He worked for Encana previously, as well. 

“This is an industry approach,” he said of the new association. “That sort of unity opens a lot of doors and things are well received on the government front.”

Fellow co-chair Ed Bereznicki agreed. He’s president and CEO of First Helium Inc., another member company. His career expertise includes gas pipelines and capital markets.

“It started with realizing we had some common goals as it related both provincially and federally with respect to regulatory and fiscal (matters),” he said. “We have been doing a tremendous amount of work … furthering the group’s causes, if you will, and interests.”

One of those causes relates to taxation.

“Spending on helium exploration and development sourced from the Western Canadian Sedimentary Basin (WCSB) does not receive equal treatment of tax measures provided other Canadian mineral developers, namely the Canadian Exploration Expense (CEE) or the Canadian Development Expense (CDE),” HeDAC wrote in a submission to the federal government for pre-budget consultations in advance of the 2024 federal budget.

This is related to a clause in the Income Tax Act that the groups says inadvertently precludes minerals sourced from sedimentary deposits in Canada (including the WCSB) from receiving CEE and CDE deduction treatment.

“Of the 31 critical minerals in Canada, only one, helium, doesn’t receive this standard tax treatment,” Dunn told the DOB.

“It is a problem. It affects project economics, it affects the certainty in terms of handling of tax deductions….”

It also restricts the ability for junior explorers to access at-risk financing, he added.

On this, Bakker added: “We are kind of competing for the same dollars for exploration, in some senses … and we don’t feel the playing field is level at this point. We are trying to raise awareness of that at the federal level.”

At the provincial level, Saskatchewan has had a “head start” on helium, noted Bakker. Until recently, it has not received the same sort of focus in Alberta, leading to some things that need to be caught up on.

“We are primarily working in the southern, southeastern part of Alberta,” he added. “There has not been a lot of oil and gas activity and there has been some, I’d say, challenges on surface land access down there that we are working through.

“It is just more reflective of the fact that we are an early-stage deep exploration game, and what typically has happened in southeast Alberta was a shallow gas, fairly rapid cycle history down there. The regulation side in place down there does not necessarily fit our business today.”

With that said, Bakker called the Alberta government receptive and very good to work with. He pointed to positives in the mandate letter to Alberta’s Energy and Minerals Minister Brian Jean.

One of the tasks detailed in the letter was: Developing and improving regulatory regimes to incentivize investment in hydrogen, ammonia, helium, lithium, liquefied natural gas, small modular reactor, geothermal and mineral development in the province.

“We really appreciate the engagement there,” said Bakker.

Canada’s helium resources are estimated to be the fifth largest in the world, according to the Saskatchewan government.

Helium is commonly used in MRIs and electronics.

Bereznicki said helium will potentially play a big role in the energy transition, citing its use as a cooling mechanism for small modular reactors.

“The other avenue being tested is a replacement gas within heat pumps, which are becoming very topical in Canada,” he added. 

Dunn supported this point.

“It fits with government priorities in growing a diversified, green economy,” he said.

“A lot of people think nuclear is going to be one of the key methods of lowering the carbon footprint on the electricity system. The latest generation small modular reactor going in at Chalk River in Ontario is designed around helium cooling. (There’s) a lower carbon opportunity there.”

Other member companies include Global Helium Corp., Royal Helium Ltd. and Thor Helium.

Read the original article here.

October 13, 2023 Via Gasworld

Royal Helium has announced the successful start-up of its Steveville helium purification facility in Alberta.

The plant has been engineered to process 15,000 mcf/day of raw gas fed by two of Royal Helium’s helium wells. With this, the plant has an output capacity of around 22,000 mcf of 99.9999% helium per year.

Helium produced by the plant will meet the three-year purchase agreement that Royal Helium has made with two offtake partner agreements in the North American aerospace and space launch industries.

It is believed the the helium supplied under the contacts will have an average price of $538 per mcf. The facility at Steveville is said to have an ultra-low operating cost due to it being self-powered by fuel gas co-produced from the two helium wells.

Andrew Davidson, President and CEO of Royal Helium described the plant start-up as a “pivotal moment”.

He added, “Following a successful start-up, Royal Helium will begin ramping up towards full commercial production, making us the first publicly listed helium producer operating in Canada.”

The Steveville plant will also materially benefit from carbon credits, generated under the Technology Innovation and Emissions Reduction System in Alberta. As these carbon credits are monetised, it will have the ability to provide Royal shareholders with a material additional cash flow stream.

News of the start-up comes hot on the heels of the Helium Developer Association of Canada being formed, of which Royal Helium is a member. The association hopes to address the growing demand for a long-term, secure helium supply chain.

Other member companies of the Helium Developers Association of Canada include Avanti Helium, First Helium, Global Helium, and Thor Resources.

https://www.gasworld.com/story/royal-helium-starts-up-helium-purification-facility-in-alberta/2128968.article/

Andrew B. Davidson, president and CEO of Royal Helium LTD., joins BNN Bloomberg’s Commodities to discuss the helium industry’s latest.

https://www.bnnbloomberg.ca/commodities/video/helium-development-in-canada~2752534

June 15, 2021 Via Canadian Energy Centre

It may be the second-lightest element in the universe, but helium is heavy with potential in Canada. Global demand for helium is outpacing supply, and Canada has not only significant resources but also the expertise required to get in on the game.

“Helium is explored for, drilled, and extracted using the same techniques as what is employed in the oil and gas business,” says Phil Skolnick, managing director of equity research with Eight Capital.

Canada has the world’s fifth largest resources of virtually untapped helium, which is increasingly used in high-tech applications around the globe. The price of helium has increased by more than 160 per cent since 2017 as demand has grown and is expected to continue rising.

Helium is high tech

“People think of helium in relation to balloons and blimps. They are surprised to learn that we need it to build computer chips and advanced medical imaging equipment, run medical breathing devices and cool down small-scale nuclear reactors, amongst many other applications, particularly in the high-tech space,” Skolnick said.

“Any nation that is highly dependent on advancing technology or has an interest in joining the space race or employing nuclear energy will be major consumers of helium going forward.”

That includes growth in high tech areas like the manufacturing of fibre optic cables and semi-conductors, says Chris Bakker, CEO of Calgary-based Avanti Energy.

“The single biggest [helium] buyer right now is NASA, which uses it to purge their rockets. Companies like Netflix and Amazon web services use helium-filled hard drives, giving them 50 per cent more storage and 23 per cent lower operating costs for power. For car manufacture Tesla, helium plays a key part in leak detection for their lithium batteries,” Bakker said.

“It has so many vital uses and is essential for the growth of high tech; there really is nothing like it in the world.”

Avanti was formed by ex-Encana workers in 2019 after the company downsized due to oil and natural gas price declines. Many of the group were key players in the discovery of the B.C./Alberta Montney play, one of the premiere natural gas formations in North America.

“We realized that helium extraction involves the same skill sets as drilling for oil and gas, so it was a great opportunity to apply our experience and abilities,” said Bakker.

Avanti is in the exploration stage, drilling and testing wells and negotiating with large gas marketers. The company has established roughly 75,000 acres of land holdings in Alberta and Montana.

Tapping into helium

Helium has historically been recovered as a byproduct of natural gas, but the value of helium has increased so much that now companies in Canada are targeting the element on its own, according to GLJ Petroleum Consultants.

As a prime example, this June Calgary-based North American Helium opened the largest helium production facility in Canada, located in southwest Saskatchewan. The $32-million project is expected to produce more than 50 million cubic feet per year of purified helium.

Global demand is now over 6 billion cubic feet per day and expected to grow by 6.5 per cent per year through 2025, Skolnick said.

Tapping into helium is no small feat. A byproduct of the natural decay of uranium and thorium, helium is found deep in the Earth’s core. This extremely small and light element immediately rises and follows natural pathways until it is trapped and sealed in different locations underground.

“We are in the business of finding these reservoirs of helium and drilling into them like we did for natural gas,” said Bakker.

“It feels like a frontier version of oil and gas because it’s such a new sector and there isn’t much data available on where to drill. For our team, these are exciting times as we – literally and figuratively – break new ground every day. Each time we go to work we are leaving our own mark on history.”

Helium for high tech a growing Canadian opportunity

OTTAWA, ON, June 2, 2023 /CNW/ – Global liquid helium supply disruptions are posing critical challenges in Canada, affecting the provision of essential medical services and detrimental to Canadian scientific research and industry. The Canadian Helium Users Group (CHUG), together with the Canadian Association of Medical Radiation Technologists (CAMRT) and the Canadian Association of Radiologists (CAR) are joining forces to advocate for the establishment of a sustainable and secure helium supply in Canada.

The impact of the helium supply shortage is particularly felt in healthcare. More than 2.3 million magnetic resonance imaging (MRI) examinations were conducted in Canada using 378 MRI scanners in 2019-2020. All of these scanners require helium to function, and without adequate supply must be shut down. For every machine that needs to be shut down, 240-350 examinations would be lost over the course of a two-week period, at a time when the system is already experiencing record backlogs and wait times. Furthermore, emergent patients would not have access to MR imaging, which would delay detection of disease and increase the proportion of patients presenting with more advanced disease. 

“Without an adequate supply of liquid helium, many MRI magnets located in Canadian healthcare institutions are at risk of a “quench”, which effectively shuts them down. This would lead to delays in early disease detection and diagnosis, added healthcare costs and ultimately compromise patient outcomes. Canada needs to invest in a sustainable national helium supply chain.” – Dr. Ania Kielar, President, CAR

“We should not be waiting for the time when MRI scanners are shut down due to a shortage of helium. Acting now, to implement the recommendations of this group will ensure the continuity of MRI imaging, so critical to the care of millions of people in Canada every year.” – Megan Brydon, President, CAMRT.

Helium is undeniably critical for life science, chemistry, engineering, and physics research programs. Nuclear magnetic resonance (NMR) spectroscopy used in these fields is also experiencing negative impacts from the helium supply shortage. A recent survey conducted by the CHUG found that 72% of facilities had difficulty procuring liquid helium within the last nine months. In addition, many labs have been subjected to unscheduled price increases, ranging from 25% to as much as 400%.

“Canada’s contribution to the global helium supply is only 1%, leaving Canadian consumers vulnerable to supply disruptions. Canada can establish a ‘Made in Canada’ helium production and distribution solution by investing in large-scale purification and liquefaction facilities. This would ensure a secure supply for healthcare, research, and industry. It would position Canada as a global leader in helium utilization, foster job creation, and technological innovation.” said Bob Berno, NMR Facility Manager at McMaster University and CHUG Representative

Helium is a precious, non-renewable resource, and establishing a national supply chain will mitigate the risk of ongoing and future global supply chain challenges and price fluctuations. Recently in Saskatchewan, several new sites have been developed for helium capture. North American Helium has built a system to purify the gas, then shipped it to the US for liquefication and distribution into the global market. However, Canada currently does not have an industrial-sized liquefication hub. The Government of Saskatchewan’s “Helium Action Plan: From Exploration to Exports” outlines an innovative approach to exploring, producing, processing, and exporting helium. Their goal is to have Saskatchewanproduce 10% of the world’s helium by 2030, which, if achieved, would meet Canadian helium needs and provide a surplus for export.

Today, the CHUG, CAMRT, and CAR Helium working group released its position entitled Establishing a Sustainable and Secure Canadian Helium Supply. The consensus position of the three groups provides background on helium supply, as well as recent supply challenges and offers the following recommendations:

• That the federal government, working in collaboration with provincial governments and industry, expedites the development of a large-scale Canadian helium purification and liquefaction facility to complete a sustainable national helium supply chain.
• That the federal government creates a funding mechanism so that laboratories and institutions can access funds to install helium recovery systems and create and/or optimize existing local reliquefication systems to promote environmental sustainability.
• That the federal government adds helium to the list of urgent mineral shortages to be addressed within the federal budget.

We can safeguard critical healthcare services, drive innovation, and reduce our environmental impact by addressing the helium supply challenges with a ‘Made in Canada’ solution. CHUG, CAMRT, and CAR urge the federal government, industry stakeholders, and regulatory bodies to prioritize establishing a sustainable and secure Canadian helium supply.

SOURCE Canadian Association of Medical Radiation Technologists

For further information: Christopher Topham, CAMRT at (613) 234-0012 x 230 or ctopham@camrt.ca

https://www.newswire.ca/news-releases/calling-for-the-establishment-of-sustainable-and-secure-canadian-helium-supply-812199940.html